The Imposition of Price Ceilings on a Market Often Results

question 10

Multiple Choice

The imposition of price ceilings on a market often results in

• A)an increase in investment in the industry.
• B)a persistent surplus in the market.
• C)the diversion of income toward black-market suppliers.
• D)lower prices being offered on the black market.

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Definitions:

Allowances

The intentional difference between the maximum material limits of mating parts to ensure a certain type of fit.

Tolerances

The permissible limits or variations in dimensions, properties, or conditions of an object or system, allowing for proper function without exact precision.

Tightness

The quality or state of being fixed or secure, often referring to the absence of unwanted movement between parts.

Looseness

The state or condition of being not tightly fixed or securely attached, leading to undesired movement.